not all land lord policies are same..

not all land lord policies are same..

there are different types of fire policies,

1. market value policy.
2. replacement cost policy.
3. 80-20 co-insurance policy.

of all three, #1 is least expensive, you only need to insure the property to its market value, regardless how much it cost to rebuild.

#2, you insure to the full replacement cost of the property, more expensive.

#3, is what I carry, they call it 80-20 policy, meaning I must insure minimum 80% of the replacement cost, its little less expensive than full coverage. but it is very tricky how the policy spells out, if you have a fire, insurance will estimate the full replacement cost, and if you are under insure, they will not pay the total claim. for example, the house fire I had last year, house is totaled, it was insured for 94k, meaning the complete replacement will be 117k. on that claim, the replacement cost of repairs came in under $110k, so insurance pay the full 94k claim, but if the their replacement cost came in at 120k, then I am under insured, they will pay 94k less deficiency(120k - 117k = 3k), which be 91k.

so to your Qs,
1. depends on your policy.

2. no. they don't want your ground.

3. can be either way, usually insurance company has direct contact with local contractors, which insurance company get a getter rate. you should always ask to use your own contractor. or better yet, if yourself is a contractor(must be separate entity), you can do it yourself (because claims usually include 10% overheat and 10% profit), but if this the case, insurance only pay you on installments, the finally 20% only pay upon certificate of occupancy.

4. you still own the ground, but if you have a mortgage, depends on size of claim, the claim check may bears both you and mortgage holder's name. in that case, you need to open escrow with bank, if you repair it, bank will di*****urse as project progress, whatever remaining, will go toward principle.